Vodafone is closing down Wayfinder Systems, a navigation company the British operator acquired in December 2008. The introduction of free turn-by-turn navigation services from Google and Nokia has completely turned the sector on its head, according to Vodafone.

Vodafone acquired Wayfinder for 239 million Swedish kronor (US$33 million), and the goal was to develop a suite of new location-aware products and services, according to Vodafone.

However, since then, things have changed. From a commercial point of view, it is no longer viable for Vodafone to continue to operate and develop its own products, Anna Cloke, head of brand communications at Vodafone, said.

Vodafone has no plans to use existing Wayfinder products in the future. Instead, it will look to partner with other companies and offer navigation and location-based services, according to Cloke. During a period of transition, existing Vodafone users will continue to find their way using Vodafone's Wayfinder-based products.

Currently, Wayfinder has about 95 employees in Sweden, Romania and the U.K. who, except for a small group that will handle the transition to other products, will be let go, according to Cloke.

Vodafone's decision to shut down Wayfinder doesn't come as a surprise, but it is still a little sad, according to a former Wayfinder executive, who requested anonymity. "Vodafone has botched up another opportunity," he said.

Another former employee, who didn't want his name used either, is surprised that Vodafone doesn't have any plans for Wayfinder's platform.

That Vodafone, and operators in general, are having such a hard time competing with the likes of Google and Nokia simply comes down to focus, he said. Vodafone is good at price plans and selling subscription, not developing services, he said.